Mt. Sterling council to keep water flowing to prison
The Mt. Sterling City Council voted unanimously Monday to keep the water on at the nearby state prison, but the issue isn't likely to evaporate any time soon due to the state's ongoing budget impasse.
The meeting was held before a standing room-only crowd, many of whom attended to speak against a proposal that would have directed the city water department to turn the tap off to the medium-security Western Illinois Correctional Center because of a delinquent water bill totaling more than $300,000.
The delinquency is representative of a much larger state pattern of not paying vendors for billions of dollars in goods and services due to a budget impasse that has left Illinois without a 2015 fiscal budget. There are no signs there will be one in place for fiscal year 2016 fiscal, either.
Residents argued to council members that while the city’s principal was sound, iit can’t indefinitely foot the state’s prison water bill. However, shutting off the water could cause the prison to close entirely, an outcome that would wreak havoc on the region’s economy.
“If you shut off the water, you’re going to create new family problems," Jerry Cook, a local businessman, said. "Give it some time.”
Resident Mark Grander said shutting the water off wouldn’t guarantee the state would pay the money, and could lead to further unintended consequences for the area. He blamed Gov. Bruce Rauner for the budget impasse that has exacerbated the water-billing problem.
“If you shut it off, you’re not going see that money anytime soon,” he said.
Phillip Krupps, a local investment adviser, presented the council with a report he prepared that concluded the city could continue to operate without the prison’s water money.
Krupss said he considered several factors in the report, including how much available capital the delinquent bill actually was costing the city and the impact of the prison shutting down in the event the water was cut off. “Economically, there is no sense to doing that (shutting off the water) because of the risk that it runs,” he said.
Krupps suggested council members ask about a state-supported program called the Vendor Payment Participation Program that allows though who are owed money by the state to put those receipts into a fund that is purchased as an investment vehicle by a large bank.
He said Citibank was one of the major lenders participating in the program. Under it, the bank is given an interest rate that can be collected once the bill is paid by the state in the future. He said the downside is that the village would not be entitled to the interest that would accrue on the unpaid money, but the upside is that the debt would be managed without administrative fees.
Mayor Dane Flesner said he understood all of the sides of involved, which also include a faction of constituents who think the city should cut the water off if only because that’s the same rules residents are subject to when they are delinquent paying their bills.
He said the uncertainty involved with the decision – that shutting the water off might force the prison to close – had made him believe that keeping it one was the best decision for the community.
“Is (closing the prison) a bluff? How do we know?” he asked. “I don’t think it’s worth it. The repercussions and the unknowns are just way too many.”
Once councilman said he was worried that the city would allow the bill to keep mounting, and due to inactivity in the state legislature, the prison would close anyway.
The motion to keep the water running included phrasing asking for “good faith” in negotiating the balance with the state. There was some discussion about taking up discussion of the vendor participation plan in a future committee meeting.